In this issue:
- Procedural update on filing compliance for Installment Agreements
- Employment tax exams initiated from income tax audits
- Are you sending Thank You notes?
Filing Compliance for Campus Installment Agreements
An update has been made to IRM 5.19.1.4.4.1 effective July 1, 2021 to allow Campus Collection to grant payment plans to taxpayers whose account records show filing delinquency for 2019 and 2020. Since the IRS is still woefully behind on processing paper filed returns for 2019, not to mention 2020, their have been issues with taxpayers that have filed to get an IA established to resolve prior tax periods.
This IRM change addresses this issue, and finally gives you an option to help clients that are stuck in this situation. As you should already be aware, the IRS employee handling a Collection case is required to do a compliance check to make sure the taxpayer has filed all required returns before they authorize an Installment Agreement for that taxpayer. If their 2019 or 2020 return is sitting in a mail tub somewhere, not yet opened, then the taxpayer has met their filing obligation and should be able to get their IA.
This IRM update is in effect through the end of the current fiscal year (Sep. 30, 2021). Telephone assistors can set up the IA even if the return does not show up on IRS computer systems — but again, only for 2019 and 2020 returns. In addition, if you have a client that filed a 2020 return that has not been processed, ask the IRS employee to include the 2020 liability in the payment plan right now as you set it up. You’ll need a copy of the client’s 2020 return in hand, to read off the balance due, but it can help reduce penalties and interest a little bit and definitely saves a lot of time.
This procedural deviation applies to both IMF and BMF liabilities; AKA, both individual and business tax debts.
To learn more about Installment Agreement procedures, including the purpose of demonstrating that your client is current and compliant and how that benefits your client, see our 2-hour CPE class, CTR-132: Individual Installment Agreements, available exclusively to Academy members.
Examination Begets Examination
IRS Policy Statements are an under-explored portion of the already under-explored Internal Revenue Manual (IRM). Studying the IRM is, in my experience, the key to being a better taxpayer representative, and I’ve recently become fascinated with … Continue reading